Auction clearance rates spike year-on-year

Auction markets have shown a strong result on higher volumes, with preliminary clearance rates hovering around the 80 per cent mark across the largest auction markets, according to CoreLogic.

The property research group’s market indicator summary for the week ending 16 February showed the number of properties taken to auction is tracking well above levels from a year ago.

There were 1,555 homes taken to auction across the combined capital cities last week, returning a preliminary auction clearance rate of 78.6 per cent.

In comparison, 1,167 auctions were held the week ending 9 February, returning a preliminary clearance rate of 69.4 per cent, before revising down to a final clearance rate of 67.7 per cent.

The data showed that over the same week last year, auction volumes were lower with 1,450 homes going under the hammer across the combined capital cities, returning a final auction clearance rate of just 51.2 per cent.

Across the individual capital cities, auction volumes increased in the largest auction markets, including Melbourne, Sydney and Brisbane. The other four smaller auction markets saw a decrease in auction volumes year-on-year, particularly Perth, where there were 19 homes taken to auction, compared with 42 last year.

However, Perth saw an 80 per cent clearance rate last week, compared with 24.3 per cent last year.

In Melbourne, a preliminary auction clearance rate of 79.2 per cent was recorded across 717 auctions last week, while in the week of 9 February, there were 419 auctions returning a final clearance rate of 68.5 per cent.

One year ago, the clearance rate was just 52.5 per cent across 657 auctions.

In Sydney, there were 578 auctions held last week, returning a preliminary clearance rate of 80.3 per cent. In comparison, there were 447 auctions held over the week of 9 February, and the final auction clearance rate was 77.6 per cent.

One year ago, 523 auctions were held and the clearance rate came in at 54.6 per cent.

Across the smaller auction markets, Brisbane had the highest volume of auctions with 104 homes going under the hammer, returning a preliminary clearance rate of 61.5 per cent.

Auction activity decreased slightly in Adelaide, Tasmania and Canberra, with auction volumes decreasing slightly year-on-year.

However, Canberra’s clearance rate stood at 90.3 per cent from 48 homes taken to auction for the week of 16 February, compared with a 45.5 per cent clearance rate from 52 homes taken to auction last year.  

Data from the Australian Bureau of Statistics (ABS) released last week revealed that the number of home loan commitments for first home buyers (FHB) rose by 6.2 per cent in December, following two consecutive months of a dip in activity.

The Lending Indicators data for December 2019 also showed that owner-occupier FHBs made up 30.2 per cent of all owner-occupier loan commitments in December, increasing from 29.7 per cent in November.

[Related: Auction volumes bounce after slow start to 2020]

Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.

Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.